The US information technology (IT) services industry includes about 100,000 companies with combined annual revenue of about $325 billion. Major companies include Computer Sciences Corporation (CSC), Unisys, and the technology consulting arms of IBM and Hewlett-Packard. The computer facilities management segment of the industry is highly concentrated: the 50 largest companies generate about 80 percent of revenue. The rest of the industry is fragmented: the 50 largest companies account for about 40 percent of revenue.

Worldwide IT services spending is about $3.7 trillion annually, according to Gartner. Leading exporters of computer and technology services include India, the US, Israel, and China, according to the World Trade Organization. Major companies based outside the US include Fujitsu (Japan), T-Systems International (a subsidiary of Germany's Deutsche Telekom), and Cap Gemini (France).

COMPETITIVE LANDSCAPE
Demand for IT services is driven by rapid technological advances, but spending for these expensive products depends on the health of the US economy. The profitability of companies depends on offering technical expertise, innovative services, and effective marketing. Large companies have advantages in broad service offerings and global reach, which give them the ability to provide outsourcing services to big corporate customers. Small companies can compete effectively by specializing in market niches or by partnering with larger companies that want to broaden their mix of services.

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